By pbump@hubspot.com (Pamela Bump)

With a purchasing power of more than $143 billion, Gen Z is expected to shake up the retail industry.

Although many in Gen Z are earning their first paychecks, entering college, or just joining the workforce, studies show that the generation shops and spends money much differently than its millennial predecessor.

While millennials and past generations were more loyal to brands, Gen Z is more interested in buying products that will give them the best value based on their price. Gen Zers also admits to being more impulsive in their shopping habits than older generations.

A Breakdown of Generation Z’s Spending Habits

When it comes to the total share of spending, Gen Z accounts for an estimated five percent in the U.S., according to Afterpay’s 2021 Next Gen Index. However, that number is expected to grow 10% by 2030, as most will be entering the workforce.

With every age group, generation Z’s spending habits declined at the onset of the COVID-19 outbreak. However, the Afterpay report reveals that Gen Z recovered faster than older generations.

So what are they doing right now? Well, they’re shopping more online.

A 2021 Consumer Culture Report by 5WPR found that Gen Z is now spending 43 minutes more per on online shopping than they did before the COVID-19 outbreak.

They (77%) say online shopping allows them to discover products from new or small companies they wouldn’t find in person. Only 38% say they prefer in-store shopping.

The number one place Gen Z lives online is YouTube. It’s where they spend their time but also where nearly half (47%) research products they’re interested in purchasing, according to the report. Instagram comes next, followed by Snapchat, then TikTok.

The report also suggests that Gen Z is the most passionate when it comes to buying products from brands that align with their values. The study found that 45% of Gen Z have boycotted a business and 36% enjoy buying products that display their social and political beliefs.

Another thing we can expect from Gen Z is their reliance on influencers to recommend products.

A 2021 Survey Monkey report found that this generation trusts influencers the most, with 11% using them as their trusted source for product recommendations – compared to 7% in millennials and 3% and lower in 40+ consumers.

To help brands market to Gen Z when they reach full purchasing power, here’s what we expect them to invest in over the next year.

5 Things Gen Z Will Spend Money On

According to a 2021 Consumer Culture Report by 5WPR, Gen Z is prioritizing electronics and technology along with health and wellness.

Conversely, Millennials and those from older generations prioritize travel and experiences, home goods, and furniture.

Based on additional research, we also found that Gen Z also pays special attention to small businesses. They are also willing to wait for a good discount before making a purchase and take advantage of buy-now-pay-later …read more

Source:: HubSpot Blog

Author: Aaron